The Financial Statements are prepared under historical cost convention in accordance with Generally Accepted Accounting Principles in India (Indian GAAP) and comply in all material aspects with the applicable Accounting Standards notified under the relevant provisions of the Companies Act, 2013.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and is recorded net of claims, etc., as considered appropriate. Revenue from Conversion, Sale of Scrap and obsolete stores is accounted for at the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest, Insurance claims are recognized on the time proportion method.

(iv) Subsidy from Department of Fertilizers is recognized, based on the eligible quantities supplied by the Company, at the rates as notified/announced by the Government of India.

(c) Fixed Assets and Depreciation:

(1) Fixed Assets

Fixed Assets are stated at cost of acquisition (net of CENVAT/VAT) inclusive of all expenditure of capital nature such as inward freight, duties & taxes, installation and commissioning expenses, appropriate borrowing costs and incidental expenses related to acquisition.

(2) Depreciation

(A) Depreciation on Fixed Assets other than Leasehold Land and those mentioned above are provided under Straight Line Method at the rates specified in Schedule XIV of the Companies Act, 1956 till FY 2013-14. Further in case of Assets installed by the Company in one plant, taken on operating lease, the Depreciation was provided on Reducing Balance Method at the rate prescribed under Schedule XIV of the Companies Act, 1956 till FY 2013-14.

(B) Pursuant to the notification of Schedule II of the Companies Act, 2013, by the Ministry of Corporate Affairs effective from 1st April 2014, the management has reassessed and changed based on an independent technical estimates, wherever necessary, the useful lives to compute depreciation, to confirm to the requirements of the Companies Act, 2013. The revised useful life for various class of assets is as follows:

Particulars Depreciation/Amortization

(i) Leasehold Land Over the remaining tenure of lease

(ii) Building Over a period of 19 years

(iii) Residential Quarters Over a period of 30 years

(iv) Plant & Equipments Over its useful life as technically assessed, i.e. over a period of 9 - 19 years, based

on the type of processes and equipments installed.

(v) Computers Over a period of 3 years

(vi) Furniture and Fixtures Over a period of 10 years

(vii) Vehicles Over a period of 7 years

(C) Product/Process Development Expenses are amortized over the estimated useful life of the product.

(3) Impairment loss, if any, is provided to the extent, the carrying amount of assets exceeds their recoverable amount. Recoverable amount is higher of net selling price of an assets or its value in use. Value in use is present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market value.

(ii) Long term investments are stated at cost less provision for permanent diminution in value if any, of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is lower.

(f) Retirement Benefits:

Employee benefits are charged off in the year in which the employee has rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on the date of the transaction. The exchange rate differences arising out of such transactions are dealt with in the Profit and Loss Account, except in case of long-term loans, where they relate to acquisition of fixed asset, in which case they are adjusted to the carrying cost of such assets. The premium in case of future contracts is dealt with in the Profit and Loss Account proportionately over the period of the contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the Profit and Loss Account for the year. Capital Expenditure on Research and Development is included as part of fixed assets and depreciation is provided on the same basis as for other fixed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Profit & Loss Account of the year to which they relate.

(j) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the agreement on pro rata basis.

(k) Income Tax:

Tax expense comprises of current tax and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act.

Deferred Tax reflects the impact of timing differences between Taxable Income and Accounting Income for the year and reversal of timing differences of earlier years. Deferred Tax is measured on the basis of Tax Rates and Tax Laws enacted or substantively enacted at the Balance Sheet. Deferred Tax Assets are recognized only if there is reasonable certainty of their realization except in case of Deferred Tax Assets on unabsorbed depreciation and carried forward business losses, which are recognized only if there is virtual certainty of their realization.

Minimum Alternative Tax (MAT) credit is recognized as an asset only when and to the extent there is convincing evidence that the Company will pay normal income tax during the specified period i.e., the period for which MAT Credit is allowed to be carried forward. The Company reviews the same at each balance sheet date.

(l) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of an asset is capitalized as part of the cost of that asset. Other borrowing costs are charged to the Profit and Loss Account.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive obligation as a result of a past event, for which it is probable that a Cash Outflow will be required and a reliable estimate can be made of the amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible obligation or a present obligation and it is probable that a Cash Outflow will not be required to settle the obligation.

(n) Principles of Scheme of Arrangement & Disclosures:

Mar 31, 2015

(a) Accounting Basis:

The financial statements are prepared under historical cost convention
in accordance with generally accepted accounting principles in India
(Indian GAAP) and comply in all material aspects with the applicable
accounting standards notified under the relevant provisions of the
Companies Act, 2013.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and
is recorded net of claims, etc., as considered appropriate. Revenue
from Conversion, Sale of Scrap and obsolete stores is accounted for at
the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest, Insurance claims are recognized
on the time proportion method.

(iv) Subsidy from Department of Fertilizers is recognized, based on the
eligible quantities supplied by the Company, at the rates as
notified/announced by the Government of India.

(A) Depreciation on Fixed Assets other than Leasehold Land and those
mentioned above are provided under Straight Line Method at the rates
specified in Schedule XIV of the Companies Act, 1956 till financial
year 2013-14. Further in case of Assets installed by the Company in one
plant, taken on operating lease, the Depreciation was provided on
Reducing Balance Method at the rate prescribed under Schedule XIV of
the Companies Act, 1956 till financial year 2013-14.

(B) Pursuant to the notification of Schedule II of the Companies Act,
2013, by the Ministry of Corporate Affairs effective 1st April, 2014,
the Management has reassessed and changed based on an independent
technical estimates, wherever necessary, the useful lives to compute
depreciation, to confirm to the requirements of the Companies Act,
2013. The revised useful life for various class of assets is as
follows:

Particluars Depreciation/Amortisation

(i) Leasehold Land Over the remaining tenure of lease

(ii) Building Over a period of 19 years

(iii) Residential Quarters Over a period of 30 years

(iv) Plant & Equipments Over its useful life as technically assesed
i.e. over a period of 9 - 19 years, based on the type

of processes and the equipments installed.

(v) Computers Over a period of 3 years

(vi) Furniture and Fixtures Over a period of 10 years

(vii) Vehicles Over a period of 7 years

(C) Product/Process Development Expenses are amortized over the
estimated useful life of the product.

(3) Impairment loss, if any, is provided to the extent, the carrying
amount of assets exceeds their recoverable amount. Recoverable amount
is higher of net selling price of an assets or its value in use. Value
in use is present value of estimated future cash flows expected to
arise from the continuing use of an asset and from its disposal at the
end of its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market
value.

(ii) Long term investments are stated at cost less provision for
permanent diminution in value if any, of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is
lower.

Employee benefits are charged off in the year in which the employee has
rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on
the date of the transaction. The exchange rate differences arising out
of such transactions are dealt with in the Profit and Loss Account,
except in case of long-term loans, where they relate to acquisition of
fixed asset, in which case they are adjusted to the carrying cost of
such assets. The premium in case of future contracts is dealt with in
the Profit and Loss Account proportionately over the period of the
contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the
Profit and Loss Account for the year. Capital Expenditure on Research
and Development is included as part of fixed assets and depreciation is
provided on the same basis as for other fixed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Profit and
Loss Account of the year to which they relate.

(j) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the
agreement on pro rata basis.

(k) Income Tax:

Tax expenses comprise of current tax and deferred tax, current income
tax is measured at the amount expected to be paid to the tax
authorities in accordance with the Income Tax Act.

Deferred Tax reflects the impact of timing differences between Taxable
Income and Accounting Income for the year and reversal of timing
differences of earlier years. Deferred Tax is measured on the basis of
Tax Rates and Tax Laws enacted or substantively enacted at the Balance
Sheet.

Deferred Tax Assets are recognized only if there is reasonable
certainty of their realization except in case of Deferred Tax Assets on
unabsorbed depreciation and carried forward business losses, which are
recognized only if there is virtual certainty of their realization.

Minimum Alternative Tax (MAT) credit is recognized as an asset only
when and to the extent there is convincing evidence that the Company
will pay normal income tax during the specified period i.e. the period
for which MAT credit is allowed to be carried forward. The Company
reviews the same at each balance sheet date.

(l) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of
an asset is capitalized as part of the cost of that asset. Other
borrowing costs are charged to the Profit and Loss Account.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive
obligation as a result of a past event, for which it is probable that a
cash outflow will be required and a reliable estimate can be made of
the amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible
obligation or a present obligation and it is probable that a cash
outflow will not be required to settle the obligation.

Mar 31, 2014

(a) Accounting Basis:

The financial statements are prepared under historical cost convention
in accordance with generally accepted accounting principles in India
and comply in all material aspects with the applicable accounting
standards notified under section 211 (3C) of the Companies Act, 1956
and the relevant provisions of the Companies Act, 1956.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and
is recorded net of claims, etc., as considered appropriate. Revenue
from Conversion, Sale of Scrap and obsolete stores is accounted for at
the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest, Insurance claims and Subsidy from
Department of Fertilizers is recognized on the time proportion method.

(A) Depreciation is provided on Reducing Balance Method at the rate
prescribed under Schedule XIV of the Companies Act, 1956, in respect of
asset installed by the Company in one plant, taken on operating lease.

(B) Leasehold Land is amortized over the period of lease.

(C) Depreciation is provided on Straight Line Basis on following assets
based on Management''s estimate at the rate mentioned below:

(i) Building @ 5.28%

(ii) Residential Quarters @ 3.34%

(iii) Computers @ 40%

(iv) Furniture and Fixtures @ 10.34% (except for the Assets of
Anushakti Chemicals & Drugs Ltd.
situated at its TarapurUnit, wherein
the same are depreciated on WDV basis
at the rate of13.91 %)

(v) Vehicles @ 15% (except for the Assets of Anushakti
Chemicals &Drugs Ltd. situated at its
TarapurUnit, wherein the same are
depreciated on WDV basis at the rate
of25.89%)

(D) Depreciation on Fixed Assets other than Leasehold Land and those
mentioned above are provided under Straight Line Method at the rates
specified in Schedule XIV of the Companies Act, 1956.

(E) Product/Process Development Expenses are amortized over the
estimated useful life of the product.

(3) Impairment loss, if any, is provided to the extent, the carrying
amount of assets exceeds their recoverable amount. Recoverable amount
is higher of net selling price of an assets or its value in use. Value
in use is present value of estimated future cash flows expected to
arise from the continuing use of an asset and from its disposal at the
end of its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market
value.

(ii) Long term investments are stated at cost less provision for
permanent diminution in value if any, of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is
lower. Inventories have been valued on the following basis:

Employee benefits are charged off in the year in which the employee has
rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on
the date of the transaction. The exchange rate differences arising out
of such transactions are dealt with in the Profit and Loss Account,
except in case of long-term loans, where they relate to acquisition of
fixed asset, in which case they are adjusted to the carrying cost of
such assets. The premium in case of future contracts is dealt with in
the Profit and Loss Account proportionately over the period of the
contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the
Profit and Loss Account for the year. Capital Expenditure on Research
and Development is included as part of fixed assets and depreciation is
provided on the same basis as for other fixed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Profit &
Loss Account of the year to which they relate.

(j) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the
agreement on pro rata basis.

(k) Deferred Tax:

Deferred Tax reflects the impact of timing differences between Taxable
Income and Accounting Income for the year and reversal of timing
differences of earlier years. Deferred Tax is measured on the basis of
Tax Rates and Tax Laws enacted or substantively enacted at the Balance
Sheet.

Deferred Tax Assets are recognized only if there is reasonable
certainty of their realization except in case of Deferred Tax Assets on
unabsorbed depreciation and carried forward business losses, which are
recognized only if there is virtual certainty of their realization.

(I) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of
an asset is capitalized as part of the cost of that asset. Other
borrowing costs are charged to the Profit and Loss Account.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive
obligation as a result of a past event, for which it is probable that a
cash outflow will be required and a reliable estimate can be made of
the amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible
obligation or a present obligation and it is probable that a cash
outflow will not be required to settle the obligation.

1.4 Note on Issued, Subscribed and Paid up Equity Share Capital:

[a] 8,43,649 (previous year 8,43,649) were issued to Shareholders of
Surfactant Specialities Ltd. pursuant to its Merger with the Company.

[b] 42,000 (previous year 42,000) were issued to Shareholders of
Avinash Drugs Ltd. pursuant to its Merger with the Company.

[c] 30,25,000 (previous year 30,25,000) were issued towards
Preferential allotment at a premium of Rs 30.65 paise to Warrantholders.

[d] 24,00,000 (previous year 24,00,000) have been issued towards
Preferential allotment at a premium of Rs 53/- to Warrantholders.

[e] 94,71,614 (previous year Nil) were issued to Shareholders of
Anushakti Chemicals & Drugs Ltd. pursuant to its Scheme of arrangement
with the Company.

3.1 (a) Out of the total ECB/Term Loans from Banks/Financial
Institutions to Rs 34,944.19 Lakhs;

(i) Outstanding Term Loans/ECBs to the extent of Rs 22,560.75 Lakhs, are
secured/to be secured by way of Pari Passu Joint Equitable Mortgage of
the Company''s immovable properties situated at Sarigam.Vapi and
Jhagadia.in the State of Gujarat, Pithampur in the State of Madhya
Pradesh, Silvassa in the Union Teritorry of Silvassa and further by way
of Pari Passu Hypothecation of the Moveable Plant & Machinery,
Machinery Spares, Tools and Accessories and other movables, both
present and future (except book debts, inventories and other current
assets) wherever situated, excluding those charged exclusively to
otherTerm Lenders.

(ii) Term Loan from Citibank to the extent of Rs 2,952.50 Lakhs is
secured by way of Exclusive Charge on the Moveable Plant & Machinery,
Machinery Spares, Tools and Accessories and other movables, both
present and future (except book debts, inventories and other current
assets) situated at the new hydrogenation unit at Jhagadia Unit II.

(iii) ECB from DBS Bank to the extent of Rs 1,497.50 Lakhs is secured by
way of Joint Equitable Mortgage of the Company''s immovable properties
situated at Bhachau, in the State of Gujarat and further by way of Pari
Passu Hypothecation of the Moveable Plant & Machinery, Machinery
Spares,Tools and Accessories and other movables, both present and
future (except book debts, inventories and other current assets)
situated at the same unit.

(iv) Term Loan from Induslnd Bank to the extent of Rs 150.00 Lakhs is
secured by way of Joint Equitable Mortgage of the one of Company''s
Immovable Property situated atTarapur, in the State of Maharashtra and
further by way of Pari Passu Hypothecation of the Moveable Plant &
Machinery, Machinery Spares, Tools and Accessories and other movables,
both present and future (except book debts, inventories and other
current assets) situated at the same unit.

(v) Term Loan of Rs 7,500.00 Lakhs from Societe Generale is secured by
way of Pari Passu Hypothecation of the Moveable Plant & Machinery,
Machinery Spares, Tools and Accessories and other movables, both
present and future (except book debts, inventories and other current
assets) wherever situated, excluding those charged exclusively to other
Term Lenders.

(vi) Term Loan ofRs 283.44 Lakhs from Financial Institution is secured
by way of exclusive charge on specific ISO-Tanks used for Company''s
operations.

(b) Vehicle loans from banks/Financial Institutions are secured by way
of hypothecation of respective vehicles.

7.1 Working Capital Loans availed from Scheduled Banks, are secured/to
be secured by way of Pari Passu first charge by hypothecation of Raw
Materials, Stock-In-Process, Semi-Finished Goods, Finished Goods,
Packing Materials and Stores and Spares, Bills Receivables and Book
Debts and all other moveable, both present and future. Also byway of
Joint Equitable Mortgage of the Company''s immovable properties situated
at Sarigam, Vapi, Jhagadia and Bhachau in the State of Gujarat and at
Tarapur in the State of Maharashtra and further by way of hypothecation
of all moveable plant & machinery, machinery spares, tools and
accessories and other movables, both present and future (except book
debts & inventories) wherever situated, ranking second to the charge
held by ECB/Term Lenders.

Mar 31, 2013

Pursuant to the approval of the Scheme of Arrangement of Demerger of
Manufacturing Activities of Anushakti Chemicals & Drugs Ltd. with the
Company'' by the Hon''ble High Courts at Ahmedabad and Bombay on 8th
March'' 2013 & 8th February'' 2013 respectively'' the Scheme has become
efective from 1st April'' 2012. As a result'' the fnancial statements as
at 31st March'' 2013 have been drawn up considering the efect of the
aforesaid Scheme.

(a) Accounting Basis:

The fnancial statements are prepared under historical cost convention
in accordance with generally accepted accounting principles in India
and comply in all material aspects with the applicable accounting
standards notifed under section 211 (3C) of the Companies Act'' 1956 and
the relevant provisions of the Companies Act'' 1956.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and
is recorded net of claims'' etc. as considered appropriate. Revenue
from Conversion'' Sale of Scrap and obsolete stores is accounted for at
the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest'' Insurance claims and Subsidy from
Department of Fertilizers is recognized on the time proportion method.

(A) Depreciation is provided on Reducing Balance Method at the rate
prescribed under Schedule XIV of the Companies Act'' 1956'' in respect of
asset installed by the Company in one plant'' taken on operating lease.

(B) Leasehold Land is amortized over the period of lease.

(C) Depreciation is provided on Straight Line Basis on following assets
based on Management''s estimate at the rate mentioned below:

(i) Building @ 5.28%

(ii) Residential Quarters @ 3.34%

(iii) Computers @ 40%

(iv) Furniture and Fixtures @ 10.34% (except for the Assets of
Anushakti Chemicals & Drugs Ltd. situated at its Tarapur

Unit'' wherein the same are depreciated on WDV basis at the rate of
13.91%)

Unit'' wherein the same are depreciated on WDV basis at the rate of
25.89%)

(D) Depreciation on Fixed Assets other than Leasehold Land and those
mentioned above are provided under Straight Line Method at the rates
specifed in Schedule XIV of the Companies Act'' 1956.

(E) Product/Process Development Expenses are amortized over the
estimated useful life of the product.

(3) Impairment loss'' if any'' is provided to the extent'' the carrying
amount of assets exceeds their recoverable amount. Recoverable amount
is higher of net selling price of an assets or its value in use. Value
in use is present value of estimated future cash fows expected to arise
from the continuing use of an asset and from its disposal at the end of
its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market
value.

(ii) Long term investments are stated at cost less provision for
permanent diminution in value if any'' of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is
lower. Inventories have been valued on the following basis:

Employee benefts are charged of in the year in which the employee has
rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on
the date of the transaction. The exchange rate diferences arising out
of such transactions are dealt with in the Statement of Proft and Loss''
except in case of long-term loans'' where they relate to acquisition of
fxed asset'' in which case they are adjusted to the carrying cost of
such assets. The premium in case of future contracts is dealt with in
the Statement of Proft and Loss proportionately over the period of the
contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the
Statement of Proft and Loss for the year. Capital Expenditure on
Research and Development is included as part of fxed assets and
depreciation is provided on the same basis as for other fxed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Statement
of Proft and Loss of the year to which they relate.

(j) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the
agreement on pro rata basis.

(k) Deferred Tax:

Deferred Tax refects the impact of timing diferences between Taxable
Income and Accounting Income for the year and reversal of timing
diferences of earlier years. Deferred Tax is measured on the basis of
Tax Rates and Tax Laws enacted or substantively enacted at the Balance
Sheet.

Deferred Tax Assets are recognized only if there is reasonable
certainty of their realization except in case of Deferred Tax Assets on
unabsorbed depreciation and carried forward business losses'' which are
recognized only if there is virtual certainty of their realization.

(l) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of
an asset is capitalized as part of the cost of that asset. Other
borrowing costs are charged to the Statement of Proft and Loss.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive
obligation as a result of a past event'' for which it is probable that a
Cash Outfow will be required and a reliable estimate can be made of the
amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible
obligation or a present obligation and it is probable that a Cash
Outfow will not be required to settle the obligation.

(n) Principles of Scheme of Arrangement & Disclosures:

a. In terms of the Scheme of Arrangement approved by the Hon''ble High
Courts at Ahmedabad and Bombay'' the Manufacturing Activities of
Anushakti Chemical & Drugs Ltd.'' is demerged and vested in the Company
with efect from 1st April'' 2012 on going concern basis.

b. Pursuant to the Scheme being approved'' the Assets and Liabilities
of the Manufacturing Undertaking of Anushakti Chemicals & Drugs Ltd.
have been vested into the Company at its respective book values. All
intra Company transactions and balances have been eliminated in the
course of aforesaid Scheme of Arrangement.

c. The Financial Statements of Aarti Industries Ltd. have been drawn
using uniform accounting policies for like transactions and other
events in similar circumstances.

d. The diference'' being the excess of the book value of the net assets
of Manufacturing Arm of Anushakti Chemicals & Drugs Ltd. over the
shares to be allotted by the Company has been adjusted into Capital
Reserve of the Company.

Mar 31, 2012

(a) Accounting Basis:

The Financial Statements are prepared under historical cost convention
in accordance with generally accepted accounting principles in India
and comply in all material aspects with the applicable Accounting
Standards notified under section 211 (3C) of the Companies Act, 1956
and the relevant provisions of the Companies Act, 1956.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and
is recorded net of claims, etc., as considered appropriate. Revenue
from Conversion, Sale of Scrap and obsolete stores is accounted for at
the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest, Insurance claims and Subsidy from
Department of Fertilizers is recognized on the time proportion method.

(A) Depreciation is provided on Reducing Balance Method at the rate
prescribed under Schedule XIV of the Companies Act, 1956, in respect of
asset installed by the Company in one plant, taken on operating lease.

(B) Leasehold Land is amortized over the period of lease.

(C) Depreciation is provided on Straight Line Basis on following assets
based on Management's estimate at the rate mentioned below:

(i) Building @ 5.28%

(ii) Residential Quarters @ 3.34%

(iii) Computers @ 40%

(iv) Vehicles @ 15%

(D) Depreciation on Fixed Assets other than Leasehold Land and those
mentioned above are provided under Straight Line Method at the rates
specified in Schedule XIV of the Companies Act, 1956.

(E) Product/Process Development Expenses are amortized over the
estimated useful life of the product.

(3) Impairment loss, if any, is provided to the extent, the carrying
amount of assets exceeds their recoverable amount. Recoverable amount
is higher of net selling price of an assets or its value in use. Value
in use is present value of estimated future cash flows expected to
arise from the continuing use of an asset and from its disposal at the
end of its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market
value.

(ii) Long term investments are stated at cost less provision for
permanent diminution in value if any, of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is
lower.

(f) Retirement Benefits:

Employee benefits are charged off in the year in which the employee has
rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on
the date of the transaction. The exchange rate differences arising out
of such transactions are dealt with in the Statement of Profit and
Loss, except in case of long-term loans, where they relate to
acquisition of fixed assets, in which case they are adjusted to the
carrying cost of such assets. The premium in case of future contracts
is dealt with in the Statement of Profit and Loss proportionately over
the period of the contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the
Statement of Profit and Loss for the year. Capital Expenditure on
Research and Development is included as part of fixed assets and
depreciation is provided on the same basis as for other fixed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Statement
of Profit & Loss of the year to which they relate.

(j) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the
agreement on pro rata basis.

(k) Deferred Tax:

Deferred Tax reflects the impact of timing differences between Taxable
Income and Accounting Income for the year and reversal of timing
differences of earlier years. Deferred Tax is measured on the basis of
Tax Rates and Tax Laws enacted or substantively enacted at the Balance
Sheet.

Deferred Tax Assets are recognized only if there is reasonable
certainty of their realization except in case of Deferred Tax Assets on
unabsorbed depreciation and carried forward business losses, which are
recognized only if there is virtual certainty of their realization.

(l) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of
an asset is capitalized as part of the cost of that asset. Other
borrowing costs are charged to the Statement of Profit and Loss.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive
obligation as a result of a past event, for which it is probable that a
Cash Outflow will be required and a reliable estimate can be made of
the amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible
obligation or a present obligation and it is probable that a Cash
Outflow will not be required to settle the obligation.

Mar 31, 2011

(a) Accounting Basis:

The financial statements are prepared under historical cost convention
in accordance with generally accepted accounting principles in India
and comply in all material aspects with the applicable accounting
standards notified under section 211(3C) of the Companies Act, 1956 and
the relevant provisions of the Companies Act, 1956.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and
is recorded net of claims, etc., as considered appropriate. Revenue
from Conversion, Sale of Scrap and obsolete stores is accounted for at
the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest, Insurance claims and Subsidy from
Department of Fertilizers is recognized on the time proportion method.

(A) Depreciation is provided on Reducing Balance Method at the rate
prescribed under Schedule XIV of the Companies Act, 1956, in respect of
asset installed by the Company in one plant, taken on operating lease.

(B) Leasehold Land is amortized over the period of lease.

(C) Depreciation is provided on Straight Line Basis on following assets
based on Management's estimate at the rate mentioned below:

(i) Building @ 5.28%

(ii) Residential Quarters @ 3.34%

(iii) Computers @ 40%

(iv) Vehicles @ 15%

(D) Depreciation on Fixed Assets other than Leasehold Land and those
mentioned above are provided under Straight Line Method at the rates
specified in Schedule XIV of the Companies Act, 1956.

(E) Product/Process Development Expenses are amortized over the
estimated useful life of the product.

(3) Impairment loss, if any, is provided to the extent, the carrying
amount of assets exceeds their recoverable amount. Recoverable amount
is higher of net selling price of an assets or its value in use. Value
in use is present value of estimated future cash flows expected to
arise from the continuing use of an asset and from its disposal at the
end of its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market
value.

(ii) Long term investments are stated at cost less provision for
permanent diminution in value if any, of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is
lower.

Employee benefits are charged off in the year in which the employee has
rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on
the date of the transaction. The exchange rate differences arising out
of such transactions are dealt with in the Profit and Loss Account. The
premium in case of future contracts is dealt with in the Profit and
Loss Account proportionately over the period of the contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the
Profit and Loss Account for the year. Capital Expenditure on Research
and Development is included as part of fixed assets and depreciation is
provided on the same basis as for other fixed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Profit &
Loss Account of the year to which they relate.

(j) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the
agreement on pro rata basis.

(k) Deferred Tax:

Deferred Tax reflects the impact of timing differences between Taxable
Income and Accounting Income for the year and reversal of timing
differences of earlier years. Deferred Tax is measured on the basis of
Tax Rates and Tax Laws enacted or substantively enacted at the Balance
Sheet.

Deferred Tax Assets are recognized only if there is reasonable
certainty of their realization except in case of Deferred Tax Assets on
unabsorbed depreciation and carried forward business losses, which are
recognized only if there is virtual certainty of their realization.

(l) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of
an asset is capitalized as part of the cost of that asset. Other
borrowing costs are charged to the Profit and Loss Account.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive
obligation as a result of a past event, for which it is probable that a
Cash Outflow will be required and a reliable estimate can be made of
the amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible
obligation or a present obligation and it is probable that a Cash
Outflow will not be required to settle the obligation.

Mar 31, 2010

(a) Accounting Basis:

The financial statements are prepared under historical cost convention
in accordance with generally accepted accounting principles in India
and comply in all material aspects with the applicable accounting
standards notified under section 211 (3C) of the Companies Act, 1956
and the relevant provisions of the Companies Act, 1956.

(b) Revenue Recognition:

(i) Sale of goods is recognized on dispatch of goods to customers and
is recorded net of claims, etc., as considered appropriate. Revenue
from Conversion, Sale of Scrap and obsolete stores is accounted for at
the time of disposal.

(ii) Export entitlements are recognized on realization.

(iii) Revenue in respect of Interest, Insurance claims and Subsidy from
Department of Fertilizers is recognized on the time proportion method.

(A) Depreciation is provided on Reducing Balance Method at the rate
prescribed under Schedule XIV of the Companies Act, 1956.

i) In respect of asset installed by the Company in one plant, taken on
operating lease.

ii) In respect of all fixed assets, other than Leasehold Land,
installed in Avinash Drugs Division.

(B) Leasehold Land is amortized over the period of lease.

(C) Depreciation on Computers and Vehicles is provided on Straight Line
Method at 40% and 15% respectively, based on Managements estimate of
useful life of these assets.

(D) Depreciation on Fixed Assets other than Lease hold Land and those
mentioned above are provided under Straight Line Method at the rates
specified in Schedule XIV of the Companies Act, 1956.

(E) Product/Process Development Expenses are amortized over the
estimated useful life of the product.

(3) Impairment loss, if any, is provided to the extent, the carrying
amount of assets exceeds their recoverable amount. Recoverable amount
is higher of net selling price of an assets or its value in use. Value
in use is present value of estimated future cash flows expected to
arise from the continuing use of an asset and from its disposal at the
end of its useful life.

(d) Investments:

(i) Current investments are stated at lower of cost or fair market
value.

(ii) Long term investments are stated at cost less provision for
permanent diminution in value if any, of investments.

(e) Valuation of Inventories:

Inventories are valued at Cost or Net Realizable Value whichever is
lower. Inventories have been valued on the following basis:

Employee benefits are charged off in the year in which the employee-has
rendered services.

(g) Foreign Currency Transactions:

Foreign currency transactions are accounted at the rates prevailing on
the date of the transaction. The exchange rate differences arising out
of such transactions are dealt with in the Profit and Loss Account. The
premium in case of future contracts is dealt with in the Profit and
Loss Account proportionately over the period of the contracts.

(h) Research and Development:

Revenue Expenditure on Research and Development is charged to the
Profit and Loss Account for the year. Capital Expenditure on Research
and Development is included as part of fixed assets and depreciation is
provided on the same basis as for other fixed assets.

(i) Operating Lease:

Operating Lease payments are recognized as an expense in the Profit &
Loss Account of the year to which they relate.

(J) Deferred Revenue Expenditure:

Deferred Revenue Expenditure is amortized over the period of the
agreement on pro rata basis.

(k) Deferred Tax:

Deferred Tax reflects the impact of timing differences between Taxable
Income and Accounting Income for the year and reversal of timing
differences of earlier years. Deferred Tax is measured on the basis of
Tax Rates and Tax Laws enacted or substantively enacted at the Balance
Sheet.

Deferred Tax Assets are recognized only if there is reasonable
certainty of their realization except in case of Deferred Tax Assets on
unabsorbed depreciation and carried forward business losses, which are
recognized only if there is virtual certainty of their realization.

(l) Borrowing Costs:

Borrowing cost directly related to the acquisition or construction of
an asset is capitalized as part of the cost of that asset. Other
borrowing costs are charged to the Profit and Loss Account.

(m) Provisions and Contingent Liabilities:

Provisions are recognized when the Company has a legal and constructive
obligation as a result of a past event, for which it is probable that a
Cash Outflow will be required and a reliable estimate can be made of
the amount of the obligation.

Contingent Liabilities are disclosed when the Company has a possible
obligation or a present obligation and it is probable that a Cash
Outflow will not be required to settle the obligation.